CREDIT

By ROBERT GORDON
NDP Director of Research

Although legislatures, and particularly New Demo-
cratic Party representatives are showing a great interest
in giving protection to the consumer by requiring by
law that the rate of interest on consumer credit trans-
actions be disclosed, there has developed great opposi-
tion to this by the suppliers of credit.

There are two main arguments which the opponents
of interest rate disclosures put forward that:

© The consumer doesn’t want or need to know the
rate of interest, his only need is for the actual dollar
amount.

© It is impossible to find a true interest formula for
expressing the rate of interest on conditional sales.

The error of the first argument can easily be demon-
strated by example. Suppose a person wishes to purchase
a $100 article on a time-payment plan. At one store he
can purchase the article with payments spread over six
months for a total cost of $118 ($100 for the article plus
$18 ‘carrying charges’). At another store he can purchase
the same article for the same total dollar cost $118) with
payments over 12 months. It is clear that the consumer
actually pays higher interest in the first case than in the
second, although he pays a similar total charge.

Only by knowing the rate of interest can the two plans
be easily compared. This example of course is partic-
ularly simple. Suppose the six-months plan was only $17
charge. Although its dollar cost is less, the true cost of
the credit is more than the yearly plan.

Thus just providing the dollar cost actually misleads
the consumer.

The second problem has been solved in the United
Kingdom. In their ‘Hire Purchase Act 1964’ has been
placed a formula fairly simple in calculation, which shows

the rate of interest on conditional sales. This formula is
as follows:

If:

i = true rate of interest

m = number of payments in one year

n = total number of payments needed to discharge

the debt /

d = total conditional sales charge in dollars

p = the principal, or cash advanced in dollars.
Then:

i=

2md
4% d(n — 1)

x 100

p@ + 1)

occa

| ‘FLY B.C. AIR LINES'

YOU KNOW, AGNES, SINCE
JAMES DIED I'VE HAD
ADVICE FROM EVERYOAE/

YES, BUT |'VE GOT QUITE
A BIT OF CASH, TOO.

>
(2

UG

THEY'RE SO HELPFUL
TO ME, MARY!

I'M RELIEVED To
IN GOOD HANDS

DOLLARS AND SENSE :

PUT MY MONEY |

FAITH

“T believe in Canada.

“I have faith in its future
and am dedicated to its des-
tiny.

“I believe that this country
has the potential for great-
ness, not only in material
terms, but also in the things
of the mind and spirit.

“IT believe that the ingen-
uity of our minds and the
labour of our hands applied
to our great resources can
give Canada a standard of
living and a quality of life
far beyond our fondest
dreams.

“I believe that the only
thing we need to doubt is
doubt itself. With faith in our-
selves and a sense of national
purpose, we can unite all
Canadians — labour and in-
dustry, farmer and city dwell-
er, Catholic and Protestant,
Gentile and Jew, French-
speaking and English — in a
great crusade to make Canada
a land where the good things
of life will be enjoyed by all.

“TI believe that a prosperous
Canada can be a mighty force
for peace in a troubled world.
We seek no military conquest
or territorial aggrandizement.
Instead, we shall use the
many gifts providence has be-
stowed to help nations less
fortunate than ourselves and
to wage constant war against
poverty, ignorance and dis-
ease the world round.

“T believe that if we accept
this article of faith and put
it into practice, the day will
surely come when our chil-
dren and our children’s chil-
dren will sing with pride

“O Canada... with glow-
ing hearts we see thee rise,
the true north strong and
free.”

—From a speech by
T. C. Douglas.

\e=
IS fT TRUE MY MONEY
COULD BE EARNING UP

mp
oe

IN}
‘Ay
lh fi

Ss
17

ne
a)

VANCOUVER: 562 Burrard,

Hastings & Richards, Main &
Pender, 6373 Fraser, 1299

Kingsway, And in Victoria,
Kelowna, Kamloops, Prince
George.

THE WESTERN CANADIAN LUMBER WORKER

HIGHER
EDUCATION

“Will we be able to afford
to send our children to uni-
versity? Will there be room

for them when they get
there?” ;

More and more parents are
asking themselves these ques-
tions today, as a result of
mounting university tuition
costs, and campuses which
have failed to grow as fast
as our population.

New Democrats share their
concern. New Democrats be-
lieve that no child should be
forced to become a “drop-
out” because of lack of funds,
or because the right schools
don’t exist.

A New Democratic govern-
ment would, in consultation
with the provinces, take steps

*
t

2nd Issue
Oct., 1965

to remove all tuition fees from’
institutes of higher learning,

Present educational assistant”

programs would be greatly
expanded.

“This,” said an NDP spokes-
man, “is the best possible in-

2

vestment we can make in the’ |

future of Canada. The more
education a person gets, the-
greater his earning power,
and the greater his contribu-,
tion to the country.

“This is one program that ,
will more than pay for itself
— both in economic and hu-
man terms.” r

Get the most from your chain saw...

PLUS!

3 SAW COMPONENTS °

precision-matched to your saw / ‘

Proven by test to make your saw cut up to 37%
faster and do it smoother and easier. Now you can

have precision-matched replacement components

{ eo --

to assure you of maximum performance from your ,
saw.
e OREGON DIRECT DRIVE ~
SPECIAL SAW BAR .
2 e OREGON SERIES 70 r
23 ‘CHAIN
O%  cOREGON >,” PITCH
Oz SPROCKET
eA
oO! FRLE |
BONUS GIFT
¢)) in every PAK! $-

New Oregon Wedge and new

Oregon SPIRA-CUT file
Retail Value $2.25

QARs INDUSTRIES OF CANADA LTp.

Available from more
than 2700 Oregon
dealers across Canada.
Send for free literature
on Oregon saw chains
and accessories,

Caen CHAO)

505 EDINBURGH RD, N,,
GUELPH, ONTARIO

‘ oo

ee